At the conclusion of this morning's short remarks, we will open the floor for questions. At that time, instructions will be given as to the procedure to follow if you would like to ask a question. It is now my pleasure to introduce today's first presenter, Mr. Paul Alexander. Please go ahead, sir. Thank you. Good morning, everyone. Welcome to Kimberly-Clark's first quarter earnings conference call. I'm joined today with Mike Hsu, our Chairman and Chief Executive Officer, and Maria Henry, our CFO. Earlier this morning, we issued our earnings news release, and we also published prepared management remarks from Mike and Maria that summarized our first quarter results and full year outlook. Both documents are available in the Investors section of our website. In just a moment, Mike will share a few opening comments, and then we'll take your questions. During this call, we may make forward-looking statements. Please see the Risk Factors section of our latest annual report on Form 10-K for further discussion of forward-looking statements. We may also refer to adjusted results and outlook. Both exclude certain items described in this morning's news release. That release has further information about these adjustments and reconciliations to comparable GAAP financial measures. I'll turn it over to Mike. Okay. Thank you, Paul. Good morning, everyone. I'd like to start the call today with a few brief remarks. Our first quarter results and outlook have been impacted by supply chain disruption, faster than expected consumer tissue de-stocking, and a sharp rise in input costs. While I'm not pleased with the results and our outlook, we're taking decisive actions to manage through the short-term challenges we face. We're continuing to invest in our brands and commercial capability to ensure we're able to grow both in the near term and in the long term. We gained market share in 2020, and our shares are off to a good start this year, with strong gains in many key markets. At the same time, we're moving rapidly, especially with selling price increases, to offset commodity headwinds. We've done it successfully in past commodity cycles, and we expect to do this again now. I remain confident in the underlying health of our brands and in our growth strategies. We're operating in a very dynamic environment. We know how to manage through this. I'm confident our team will execute with excellence and will continue to build a stronger company for long-term success and value creation. Now, with that, we'd be happy to take your questions. Thank you. Ladies and gentlemen, at this time, the floor is open for your questions. If you'd like to ask a question, you may do so by pressing star 1 on your touch-tone phones now. If you're using a speakerphone, please make sure that your mute function is disabled to allow your signal to reach our equipment. Again, to ask a question, please press star 1 now. Our first question comes from Dara Mohsenian with Morgan Stanley. Morning, Dara. Good morning, guys. A couple questions. First, Mike, you mentioned in the prepared remarks that were published, price increases in many other businesses besides what you already announced in late March. Can you just put a little more meat on the bone there in terms of additional product categories in the U.S. where you might take pricing, maybe some international countries where pricing is more likely? I know you want to be a bit vague at this point, any type of commentary on potential timing, magnitude of increases as you think about it across the portfolio? Okay. Thank you, Dara. Our teams have moved very rapidly and made decisive actions to realize additional prices here, obviously. We announced many price moves back toward the end of March. Those will take effect over the next couple quarters. In North America, pricing is typically going to be in the mid to high single-digit range across both our consumer tissue business and our personal care businesses. It'll cover about 60% of our overall portfolio. We are taking pricing in multiple other markets, including in Europe, Latin America, and parts of Asia. We expect pricing and additional productivity to offset most of the raw material inflation, incremental raw material inflation this year. Again, we're off to execution. We have generally announced most of our moves thus far. Okay, that's helpful. The other 40% in North America, do you think that comes eventually? Is it uncertain at this point? Is it more just timing, and you're waiting for the right timing? Yeah, I would say, the phased effects and, obviously, Dara, you might recognize we do some actions in list and some in count, and so we had plans for count that we're rolling out the wall card a little bit later. Okay. Looking at the full-year top-line guidance, it implies a pretty robust recovery relative to some of the softness that we saw in Q1. Just give us a sense for what's driving the confidence there. Is it more a category recovery as you look going forward, or are there other factors? Also, can you just comment on what you've assumed on North American market share in both personal care and consumer tissue in the balance of the year? I'm wondering what the assumptions are there, particularly in light of some of the price increases that you mentioned. Thanks. Yeah. Okay. Just on the outlook, again, I think one of the things around maybe the quarterly phasing is just recognizing that we had unusually high demand in the first half of last year, and that started toward the end of March in the first quarter and then all through the second quarter. That's really driving a difference in our outlook. One of the big reasons for our adjustment in the reduced outlook organically was what we are seeing as a faster de-stock in consumer tissue, particularly in bath tissue. I think you can see that in the scanner results as well. I do think it is a faster destock, and that looks like it's related to maybe a faster vaccination and faster pace of mobility that's changing. Interesting, we track mobility data. It looked like January, February, Dara, in the U.S., mobility was down about 30% in January and February, and it climbed to being down 15% by the time we got to March. Again, I think a lot of it is the demand that tracks with kind of what we're seeing happening in the tissue. The other areas, we had the effect of the supply chain disruptions in the first quarter that impacted our sales. That's mostly a first quarter event. Then, as Mike said, the comps get easier in the second half versus the first half. If you look at our underlying business and market shares, the underlying business is performing well. If you look at our KCP business with our expectations around mobility, we would expect KCP to pick up also. Okay. Just one clarification. Go ahead, sorry. No, go ahead. I was just going to ask, is the Q1 volume loss, do you recover any of that going forward, or is that more of that lost volume sort of applies to the full year, or is there a recovery at some point? Well, we're hoping to recover some of it, but there was a pretty big impact to the quarter that we think will stick for the year. Let me just touch on the winter storm a little bit, just to give you a little more texture. Our estimate would be conservatively on Q1, it would've been worth about $0.15 a share and two points overall of organic, which would be about five points of growth, organic growth for North America. Important to note, this will also, and this goes back to the phasing, Dara, it's also going to constrain our Q2 volume in North America, particularly in personal care, and it's also going to affect our shares in the second quarter. The backstory is, and I think you may understand, but the February storm hit in the southern U.S. and really significantly impacted our supply network. It shut down large personal care and consumer tissue facilities that we have based in Texas, Oklahoma, and Arkansas for up to 10 days. It did flow through to sales for us, Dara. Typically, I would say, Hey, a week or two down should not affect the business that much. Because of COVID last year, we were already running in a tight supply situation, that's why it has rolled through and affected our sales. It's also going to continue to impact our raw material supply. Polymer producers have been affected more than us, I would say. We're having some spot outages of some materials. Again, overall, in North America, underlying brand performance has been very healthy. We do expect, because of supply issues, our shares to soften a bit in the second quarter. It's tough because we're in fixed consumption categories. People use our products on a daily basis. When you go to buy them, if we're not on the shelf, then they'll find it elsewhere outside of Kimberly-Clark. Typically in the first quarter, when there's challenges, we would look to recover. It's a little tougher given the outages. Again, that's fixed consumption. That impact is definitely factored into our full-year reduction in our top-line outlook. That makes sense. Thanks, guys. Okay. Thank you, Dara. Thank you. Our next question comes from Lauren Lieberman with Barclays. Morning, Lauren. Great. Thanks. Good morning. I was hoping you could talk a little bit about spending levels. Just thinking about the balance here, I think you commented that investment kind of steps up in 2Q versus 1Q. One of the questions I've gotten from people a couple of times this morning was just the degree to which you're going to tap into G&A spending for the balance of the year to deal with some of the unforeseen cost headwinds. Also just related to that, and just following up on Dara's question as a point of clarification, when you talked about pricing and productivity offsetting most of the inflation, is that on a calendar year basis, or is that a over time comment? Yeah. Let me take the last one first- Sure I'll come back to between the lines. One way to think about the run-up in inflation that we have for the year is that within year, we'll cover about half of that with pricing. When you add in the additional cost savings, both in terms of our increased outlook on the FORCE program as well as additional tightening of the belt around discretionary items, you would get to cover a good portion of the inflation. If you look at the reduction or EPS outlook, you could look at it and say, after all of that, it comes down to the decline in volumes, which are affected by all the reasons that Mike just talked about. Within year, Paul, I think we're saying about half is recovered on pricing. Over time, we would expect to fully recover the commodity increases, as we always do, through a combination of price increases and cost savings. If that's helpful. Definitely. Okay. And then- And then on be- Yep. Again, that was my first one. Between the lines. Yeah. Yep. Then on between the lines, the way I think about that for the year is, first and foremost, we will continue to invest behind our K-C Strategy 2022, which means we will continue to support our brand investments. We'll continue to invest in innovation and capability development, as all of those things have been paying off for us. I look at that as protected investment. Then on discretionary costs, we'll certainly look to tighten our belt and prioritize any spending that we have this year, given the more challenging conditions. In addition, we are continuing to push the FORCE cost savings, and as I just mentioned, we upped our savings outlook for the year there, and our teams are working hard to try to pull in productivity programs into this year, as well as find new opportunities, given the overall pressure there. I'll add, Lauren, it's important for us to protect that investment in our brands because we feel like it's working very well globally, and our brands are responding well to the investment and performing very well, despite what I would say are some challenging conditions. Definitely, we believe our better execution and our investments in our quality innovation advertising are really working. Market shares are broadly up globally and almost all key markets around the world. I'll just rattle off some shares. You may be able to see these, but North America and diapers were up about a point and a half in share. In China, almost three share points. Korea, Australia, Peru were all over four share points. India, Argentina, were up over two points. Again, we feel like we have great products in the marketplace, great marketing, especially through digital, and great execution from our teams. We want to continue to support that. Okay. Just to double-check my math, which I can follow up offline with Paul if it's super wrong, but it sounds like North America personal care was on track to be up low single digits this quarter if the storms hadn't created supply chain issues. Is that fair? That's a reasonable assumption, Lauren. Okay. All right. Thanks, I'll pass it on. Thank you. Our next question comes from Kevin Grundy with Jefferies. Morning, Kevin. Great. Thanks. Good morning, guys. Quick question on K-C Professional. Did you see a pickup in the month of March? I guess looking back to last year, there should be somewhat of a natural hedge. Mike, there was a comment in the prepared remarks about potentially seeing some early effects of social mobility picking up, which had an unfavorable impact on the consumer side of the business. I wanted to tie that in two ways. Number one, did you see that pickup in the month of March? It wasn't necessarily evident in the quarter. Again, March could be looking better relative to January and February. Two, was the demand elasticity in that business in line with your expectations? It looks like you took some pricing with an obvious effect on volumes, but the business did come in quite a bit lower than the Street had modeled. Just hedging implications from some weakness on the consumer side and then comments on demand elasticity would be helpful. Yeah. Great questions, Kevin. I guess the short answer is, regarding pickup, not yet. Organic was down about 13%, with continued improvement in North America, but I would say that improvement was more on the wipers and safety business than on the core washroom business. The washroom business was down about 35%, so about where it's been. I did say mobility is improving. Again, just to refresh your memory, I think January, February, it was down about 30%, and then in March, it had improved to being down 15%. It isn't flowing through to our washroom business yet, and our business tends to be concentrated in travel and lodging, offices, and high-traffic locations like sporting events. We may see some of that start to pick up as we go forward. I do think that has been lagging, and these sectors that we tend to play harder in tend to lag the overall mobility a little bit. I will point out, wipers and safety were up strong double digits in the quarter. We feel great about the momentum of that business. Regarding your pricing, Kevin, there has been some significant pricing on the glove side in our safety business that's driven a lot of the pricing. I wouldn't say elasticity is probably coming in as we planned. It's just that there has been some unusual pricing, unusually high pricing on the safety side. Got it. Very helpful. If I could just squeeze in one more. This will be, Mike, for you and Maria as well. Just on, I think this is building on some of Lauren's question, the decision to maintain advertising and marketing levels, which I think there were some questions among the investment community whether the company would decide to do that given increased commodity cost. Mike, of course, this has been a big focus of yours since taking over. Can you talk about how internally those discussions went, just given the significant commodity cost pressure, the balance, maybe considering pulling back a little bit, your visibility on ROI in what's unarguably a really volatile environment and maybe some of the ROI models sort of less reliable given that context? Maybe just a little bit there in terms of what went into the decision-making and the visibility you feel like you have on maintaining these levels, and then I'll pass it on. Yeah. Thank you. Yeah. Kevin, I think you're all over the issues, as we discuss them. One point is, we feel like we have strong brand momentum, as I just rattled off a bunch of share and growth in what I would say are still fairly choppy waters in the categories, but we feel great about the share momentum of our business globally. Really, we can tie it back to the investments we're making in product quality, innovation, and marketing, and team execution, which is excellent. We feel good about that. There has been some discussion around that. I will say we will make some adjustments, but in a small manner. Overall, we want to maintain our investment levels. For example, in North America, where we have supply constraints, it may not be the highest ROI decision in the short term, to be driving, let's say, promotions in that business when you don't have supply. We will make some tactical adjustments. Overall, I think your point on ROI is also important, which is, it is going to vary. We don't have the latest data for ROIs on the quarter, but generally, our marketing ROIs, especially digital, has been very strong. It may not be the lever that we traditionally think of when cost conditions get a little tough because it's hard to see how cutting advertising, if it's working that effectively for us, actually helps the P&L. As you can imagine, we had pretty extensive discussions at the market-by-market level to review the advertising plans for 2021, given the environment. Where we believe we've got strong ROIs, it makes sense to continue to spend the dollars because we're getting the payback on those dollars. We did have some pretty deep internal discussions around that, and while it varies by market and by product line, the decisions, what I'd say is in our current outlook, we're expecting advertising spending to be relatively similar to 2020 levels on a dollar basis. On a percentage of sales basis, that it will be in line with our original plan coming into the year. All of that said, the mix of it and where it is and on what it is different than we would've expected three months ago, but in total, that's kind of how we're thinking about it. Okay. Thank you both very much. Have a great weekend. Great. Thank you, Kevin. Thank you. Our next question is from Steve Powers with Deutsche Bank. Good morning. Thanks. Good morning. I guess, maybe to round out what we've talked about so far, can we just talk about in the context of the cadence of your EPS guidance over the balance of the year, because obviously 1Q was a tough start. It sounds like 2Q is going to be directionally tough as well, at least from an EPS perspective. When you talk about meaningful EPS growth in the back half, I guess, is there a way to better frame what that looks like and how confident you are in the drivers? I guess because it sounds like there's going to be back-half loaded savings, and I'm assuming you have good visibility there, but I just think what I'm hearing this morning, just a lot of investors are concerned about market share movements in the back half, elasticity in the back half, and the actual efficacy of pricing rolling through, just given lost sales that you've highlighted in the first half and then differences in the way that you've announced price increases this year versus what we heard from P&G earlier in the week. Just any thoughts you have around that would be very helpful. Sure. I'll give some broad commentary, and then Mike can talk more specifically about pricing. When we look at the second half, we are expecting a stronger second half, and that is for a few reasons. The biggest reason being that our pricing actions and the benefits of that will be coming through the P&L in the second half. In terms of input cost inflation, that is ramping in the first quarter and the second quarter. We expect that it will peak and then moderate, and in some cases, come down a bit in the second half. Additionally, we've got our savings program ramping, as you can tell from the FORCE cost savings of $65 million in the first quarter and the outlook of $340-$380 for the full year. Those will be ramping, as is typical in a typical year. We also have some elevated costs in the first half of the year, which will come down some in the second half of the year. We have good visibility into it. When I look at the factors driving that, the one area that has some, what's the word I would use, some dynamicism around it would be pricing. I'll let Mike talk a little bit more about how we see that come to fruition. Steve, we did make assumptions in our pricing around the elasticity impact. We do have volume coming out of the plan as it relates to pricing. I would say we have good experience from it from just a couple of years ago. In general, our calls regarding elasticity generally were in the ballpark of what our original plans were. We feel good about kind of our ability to call it. The one difference I would say in this market would be what exactly happens, due to the COVID environment and some of the volatility related to that. Then we did have some assumptions regarding competitive price points, which we still need to learn how that's going to be executed. Yeah. One other comment that I'll make just in terms of phasing to put a point on it is, you know our performance in the first quarter. When I look at the second quarter, while we don't provide detailed quarterly guidance, we do expect the second quarter conditions will remain challenging, and that will show up in the numbers. If you think through some of those factors, there'll be more cost inflation that's coming in ahead of most of our new selling price increases. We'll have escalated costs before the pricing is really getting into the market. We'll be working through the tail end of the supply chain disruptions in North America that Mike already commented on. The category dynamics in consumer tissue and Kimberly-Clark Professional are more volatile than normal. As we said in the prepared remarks, we do expect that the between the line spending will pick up from a relatively low level in the first quarter, and that includes more investment spending. In addition to all of that, it's worth noting that we had all-time record earnings in the second quarter of 2020 behind very strong volume growth in consumer tissue. Last year we also had commodity tailwinds, and in the second quarter we had very strong FORCE cost savings. All of that is shaping up to have challenging conditions for the second quarter with our performance picking up in the second half of the year. Okay. That's helpful. I guess if I could, just how are you thinking about this setback in terms of the lower outlook for 2021, in terms of the lasting impacts here? I guess when I think about it in the context of K-C Strategy 2022, we've been talking about the mid-single-digit EPS CAGR, for a while, ever since that study was unveiled, and I think we've all been doing that in our conversations at least, with kind of like a 5% CAGR in mind. Quite frankly, you seem very much on track and even ahead, in terms of your strategic investments coming into the year. In that context, are you approaching this kind of setback in early 2021 as a speed bump on that path? Is this likely to have more enduring impacts into 2022? I'm not asking for 2022 guidance, I'm just trying to understand how impactful this is as you think about it in the context of that broader strategy. I'll check and see if I understand the question, but I think we view it as a temporary impact, that should not affect our long-term strategy. That's why we are continuing to invest in our brands. As I said before, I think our investments are working. We feel great about where the brands are going. I don't really want to take apart what we're doing in China because we had a plant that came down for a week in Texas, and so that's kind of how we're thinking about it. We recognize what our medium-term guidance has been. We plan to hit that over the long term. We also recognize that we want to accelerate organic growth beyond what our medium-term guidance was, and we are making progress on that, but recognize that we operate in environments affected by COVID, and also now this, I think once in a lifetime, at least living here in Texas, once in a lifetime storm that we always prepare for, but you never really think it's going to happen. The teams are doing a great job responding to the challenge and doing the best with what they can, and our suppliers are doing a great job partnering with us. Again, I feel like it's a temporary effect. Maria? Yeah. I would agree. We've been encouraging people to take a two-year look on our business, given the meaningful effects that the COVID-related dynamics have had on primarily the tissue categories, both on the consumer side and the professional side. When you look at our performance last year, especially in the first half where we had the incredible shift in demand and some stock-up dynamics, we didn't expect that to change our long-term outlook for the business. When you look at this year with the consumer destocking around consumer tissue this year, we expected that consumer destocking would happen. We didn't expect that it would happen as quickly as it appears to be happening. If you look at the business over a two-year period where we had net benefits from COVID last year, we've got some net headwinds on the consumer tissue side this year. The performance over the two years actually looks good and relative to our medium-term guidance, and does not affect the long-term outlook for our business. It's just we have this two-year period of big impacts from COVID-related items. Great. Thank you very much. Very generous in your answers. Appreciate it. Great. Thanks, Steve. Thank you. Our next question comes from Jason English with Goldman Sachs. Morning, Jason. Hey, good morning. Good morning, guys. Thank you very much for slotting me in. I was hoping you could provide a little more context on cadence of your expected price realization, particularly relative to the promotional environment. One thing that really stood out this quarter was the deterioration of the pricing environment in North America tissue. I mean, last quarter you reported, I think, 11% price growth in North America on lower promotions with price mix plus eight. We're back to neutral already. It looks like promotions are coming back certainly faster than I expected. Is that indeed what you're seeing, and how much of a negating factor on your price increase will that have? Yeah. Before Mike jumps in, I would call out that we had an unusually high price effect show up in the fourth quarter of last year that had to do with the timing on accruals, where we had an accrual true-up in the fourth quarter that caused that to be unusually high. It was not indicative necessarily of the market environment. I wouldn't so much compare to the fourth quarter. I'd point you more to the full year average from last year, or at least the last three quarters of last year. Mike, I'll have you comment. Yeah. Overall, Jason, that's why, knowing that we had some different items in that statement, I would say overall, we still view the North American market across personal care and tissue to be constructive. I think promotional volume in personal care returned to what I would call, I think our team calls normalized levels a few quarters ago, it's proceeded along that path, and I would say that's kind of where personal care is. In tissue, I would say promotional levels for us, at least our perception is, and our planning is a little still lower than where it had been, primarily because we still have been in tight supply. Obviously, given kind of where demand's going, that supply situation is getting reversed a little bit now. Again, we don't have significant plans in the first half to promote aggressively. Frankly, as you've heard me say before, we remain committed to our journey on the high road, and we really believe we want to grow our brands by investing in products and innovation and advertising. Over-promoting categories, for us, in a fixed consumption category, does not feel like a healthy way for the business. Again, I would say overall, the market appears to us constructive. No, that's good context. I appreciate that. I guess I didn't realize there was such a big one-time benefit in the fourth quarter last year. Quick math on that suggests it was almost $100 million, which suggests you're going to have north of $0.20 EPS headwind in the fourth quarter. Is that right? Given that your guidance is so back half-weighted, how are you going to overcome such a big hurdle? Yeah, our guidance balance is a lot of different moving factors as I described earlier. I won't repeat myself in going through those six points. If you look at the pricing on consumer tissue from last year, and you look at the trends, it's about 1% in the first half, flat in the third quarter, and then the net benefit of 6% in the fourth quarter. As I said, I'd encourage you to look at the full year and trust that we've taken all of the various factors into our second half outlook commentary. Yeah. Jason, you've been in our chair, so I think you recognize kind of we have a lot We're paid to manage through things. These things come up every year. For sure. As I mentioned in my prepared remarks, we know how to manage through these situations, and we will. Yeah. No, I understand. Thank you guys so much for your time. I really appreciate it. Thanks, Jason. Thank you. Our next question comes from Andrea Teixeira with JPMorgan. Morning, Andrea. Thank you. Good morning. I have a three-part question, please. I'm sorry for that. The first one, if you can comment on the competitive environment in personal care outside North America. I think you called out some market share gains, which are encouraging. First, on China, we heard comments from one of your competitors that the market is being more competitive as of late in diapers. What have you seen in your share dynamics there? That's the first part. The second one is on the call-out for the price increases you've taken in Europe and LATAM. Obviously you have some competitors that are local and reporting different currencies. Have you seen any results of, I mean, I know you had amazing results in Brazil in the first quarter, have you taken prices there already? With the government incentives fading, how do you expect that to be the balance of the year? Sorry, the third part is what is embedded in the KCP guidance, your comments about washrooms coming in a little bit more, obviously travel related, a bit more back-loaded. What are you expecting for that business at the balance of the year? Thank you. Okay. All right. I'll start with the competitive environment. Overall, again, I think we've been competing, as I've mentioned, Andrea, kind of in this high road approach, which would be, again, build the brands through quality, innovation, marketing, and local execution that's very, very good. Feels like to us, has been working very effectively, China especially. We were up double digits in China across both Feminine Care and diapers, so we feel great about their business. Organic was up over 20% in China in the quarter, and Huggies was up double digits, and that was driven by volume, and what I would say is a premiumizing mix. Our share is up, as I mentioned, almost three points. We feel like we have the best product in the marketplace. The teams are very good in both baby and in Feminine Care around digital marketing agility. They're very good at building that digital relationship with consumers. I think that's been a key component of driving our business. Yeah, I think the market, maybe getting a little bit more competitive, but we still feel like the Chinese consumer is looking for high-quality products. Right now, they view our products as being the best in the marketplace. Mm-hmm. That's helpful. On the price increase in Europe and LATAM, if you can comment on those? Yeah. I would say overall, we have announced pricing in Europe, and we have been announcing pricing fairly continuously in Latin America. In general, I would say, we have seen competitors move pricing in Europe. Locally in Latin America, it has been mixed. We have seen pricing moves from some of the large competitors, and then there have been one or two local ones that have not moved. That's just a dynamic that's been going on for a year or so now, and our teams have been able to operate within it. Mm-hmm. On KCP? Sorry for the three-part question. Yeah. Okay. KCP. The KCP, I think the guide is, yeah, we are planning for sequential improvement throughout the course of the year. Again, as Maria mentioned earlier, we're seeing mobility pick up faster, but in the KCP business, it hasn't flown through the washroom segments that we typically play stronger in. We do expect to see that occur as more people get back to work. I do think it's related to, at least in North America, what would be a faster vaccine rollout than we initially saw as we were ending last year. That's great. Thank you so much. I'll pass it on. Thank you. Our next question comes from Christopher Carey with Wells Fargo Securities. Hi, Chris. Hey, good morning, everyone. Just one follow-up and then another question. Just on the follow-up to a prior question, I know that you're planning to keep promotional levels steady or at least below pre-pandemic levels. Can you just comment on maybe how much control you would have over that situation, say, if overall category promotions were to start to take off, right? From a competitive standpoint, would you follow those promotions, or do you have levers that you can deploy to keep market share if competitive activity reflected higher promo were to take off? My question is just around, there's been a lot of focus on 2021, I think appropriately so. There's also this broader narrative around unemployment rates, impact on birth rates, certainly developed markets coming back a bit faster than emerging markets. Can you just talk about what you would expect from a category growth rate standpoint, say, over the next six to 12 months and maybe even a bit longer term as well? Yeah. Okay. I'll try to address, Chris. Overall promotion, I would say our approach is to kind of grow the brands through investing in the quality of the products and in advertising. With digital, that's quite an effective tool for us. I mean, not only is digital tends to be higher ROI than any of our other spends, including retail promotions. You get faster feedback on its performance, right? Again, I think we have plenty of levers. We did shift to this approach a couple of years ago, and I think it's working very effectively for us. If you ask kind of do we have the levers in our control, I would say yes. What we feel good about is we have programs developed that are robust in that sense. As I just rattle off a bunch of these shares, we feel like those are working very effectively. That said, we want to be competitive on price or promotions, but I don't think promotions in a fixed consumption category are the right long-term way to grow the category because it's different than, let's say, an impulse category like cookies, where you can drive incremental consumption through promotion. In our categories, you generally don't drive incremental consumption. You can drive share, but I'd rather earn our share rather than rent our share for the short term. It's a very expensive way to rent share, right? Again, we do have the levers. By the way, we're making significant investment in our revenue growth management capabilities, so we have the tools, and even were we to invest more in promotion, I think we'd be very selective in terms of how we spent it, and we would want to make that efficient as well. I don't know how to address your question on that part. Yeah. That's helpful. Then, just on the birth rate dynamic, are you starting to see more impact in your results? Would you expect category slowing? I wonder if you can maybe divide your comments between developed and developing markets, where maybe birth rates come down, but you have more of a GDP per cap upside type driver. Anyways, just the broader question there is just around near and medium-term expectation for birth rates and whether you're starting to see some slowing there. Thanks. Yeah. Great question, Chris. We are seeing a little slowing in the birth rate overall, both in developed and developing markets. For instance, in the U.S., where the data typically lags, the birth rate was down about a point in 2019. The latest data, although it's not officially published, I think, Paul, it would say roughly down 3 last year. That was a slowdown, and we're seeing some of that too. You may have read in China, the birth rate has come down significantly as well. I think the balancing factor is a couple different components. One is our core strategy is to elevate our categories by creating more value-added products and premiumizing our mix over time, and that's really taken hold. As I mentioned, we're up almost 3 share points in China. That's all through a premium mix of products. For instance, this year, we have the best product, we feel like, in what we call our Tier 6, which is our premium Tier. We are launching a Tier 7 product that brings a lot of the features that we have in our current premium products and escalates them further, and we're launching Tier 7 at a 50% premium to Tier 6. I do think in some markets like China, where the consumer certainly is willing to pay for what are better products, in the near term, we'll continue to drive our business that way. That said, we also have many other developing markets like Indonesia and India that are continuing to grow and where the birth rates are not as impacted yet or are still maintaining their birth rates. Also, we still have category penetration growth. Again, I think we feel good about our overall strategy. We do recognize that the environment, likely because of COVID, has affected birth rates to some extent. We feel like our strategies both in developed markets, which is to elevate our business and our categories and then continue to expand in D&E are the right ones for us. Thank you for both of those. Appreciate it. Okay. Thank you, Chris. Thank you. At this time, speakers, we have no further questioners in the queue. I want to thank you all for joining us today. Our revised outlook really reflects some significant change in our environment, and I want to assure you that our teams are taking decisive action, and we remain very confident in our high-road approach to growing our brands. Thank you. Thank you very much. Thank you. Ladies and gentlemen, that concludes today's presentation. You may disconnect your phone lines, and thank you for joining us this morning.